M&A: Ultimate Examples of Failure to Conform
A lesson learned at Yahoo came as a result of the difficulty of integrating acquisitions when the people and the cultures of the acquired company were a mismatch with ours.
Yahoo acquired a small company with an expertise in a product area that we knew would be big for us if we could get it right. We needed the people and their talent as much as their products. We had not been able to develop the expertise in that area in-house.
Unfortunately, the people of that company were complete cultural misfits for us, and we knew this as a result of our due diligence, but decided to move forward with the deal.
The former CEO of the acquired company became a business unit leader in our organization. He was a ‘command and control’ leader. His style was to give orders and people saluted and carried them out.
Yahoo’s culture was very collaborative. We got things done through relationships and influence. This leader had a difficult time succeeding in our culture, as did the team of Yahoos who reported to him. Eventually he departed, or as Collins and Porras would say in Built to Last 3, he was expelled like a virus among antibodies.
Unfortunately, we were no further along in acquiring the expertise in the particular product area for the company.
About Libby Sartain
As head of HR for both Yahoo! Inc. and Southwest Airlines, Libby led significant business transformation initiatives as a member of executive leadership teams and guided global human resources efforts focusing on attracting, retaining, and developing employees. Both Yahoo and Southwest were listed on the Fortune 100 Best Companies To Work For in America during her tenure. She holds an MBA from the University of North Texas and resides in Bastrop, Texas with her husband.